DR. JAYA THAKUR vs UNION OF INDIA, 2023

DR. JAYA THAKUR vs UNION OF INDIA, 2023

Case Title and Citation DR. JAYA THAKUR vs. UNION OF INDIA & ORS. WRIT PETITION (CIVIL) NO.456 OF 2022 (and connected petitions) 2023 INSC 616 (Decided on July 11, 2023)

Factual Background

The case concerns the tenure extensions granted to the Director of Enforcement (“ED”), Respondent No. 2, Sanjay Kumar Mishra. Mr. Mishra was initially appointed Director of ED for two years starting November 19, 2018. His initial two-year appointment was modified to three years via an order dated November 13, 2020. This modification was challenged in Common Cause (2021), where this Court, while upholding the modification, specifically directed on September 8, 2021, that “no further extension shall be granted” to Respondent No. 2.

Subsequently, the President promulgated the Central Vigilance Commission (Amendment) Ordinance, 2021, and the Delhi Special Police Establishment (Amendment) Ordinance, 2021, on November 14, 2021, and also amended the Fundamental Rules (FR) on November 15, 2021. These amendments permitted extensions of tenure for the Director of ED and Director of CBI up to a cumulative maximum of five years. Based on the newly amended law, the tenure of Respondent No. 2 was extended for one year until November 18, 2022, via an order dated November 17, 2021. During the pendency of the challenge to the Amendment Acts, a further extension was granted to Respondent No. 2 via an order dated November 17, 2022, extending his term until November 18, 2023. The present petitions challenged the validity of the Amendment Acts and both subsequent extension orders.

Issue(s)

1. Whether the Central Vigilance Commission (Amendment) Act, 2021, the Delhi Special Police Establishment (Amendment) Act, 2021, and the Fundamental (Amendment) Rules, 2021 are liable to be held ultra vires and set aside.
2. Whether the extensions granted to the tenure of the Respondent No. 2 as Director of Enforcement for a period of one year each vide orders dated November 17, 2021, and November 17, 2022, are legal and valid, and if not, whether liable to be set aside.

Decision of the Supreme Court

1. The challenge to the constitutional validity of the Amendment Acts and Rules is rejected [198 (i)].
2. The impugned orders dated November 17, 2021, and November 17, 2022, granting extensions to the tenure of Respondent No. 2 are held to be illegal [198 (ii)].
3. However, Respondent No. 2 is permitted to continue to hold office till July 31, 2023 [199 (iii)].

Reason for the Decision

1. Validity of Amendment Acts (Upheld): The Court noted that judicial review of legislative action is limited to whether the legislature lacked competence or whether the law violated fundamental rights or other constitutional provisions. The legislative competence was not questioned. The Amendments (allowing extensions of one year at a time up to five years total) were found not to be manifestly arbitrary or violative of constitutional provisions. The power to grant extension is not arbitrary because it is subject to the recommendation of a High-Level Committee (like the CVC Committee for ED/PM-led Committee for CBI), which must find the extension necessary “in public interest” and “record the reasons in writing”. These Committees are sufficiently insulated by stringent appointment and removal procedures (especially the CVC/VCs) to prevent incumbents from succumbing to the Government’s “carrot and stick” policy.
2. Validity of Extension Orders (Struck Down): The Supreme Court, in Common Cause (2021), had issued a specific mandamus that “no further extension shall be granted” to Respondent No. 2. Since the Union of India and Respondent No. 2 were parties to the Common Cause (2021) proceedings, that mandamus was binding on them. While the legislature is permitted to change the basis of a judgment by changing the law generally, it is an impermissible legislative exercise to nullify a specific mandamus or set aside an individual decision inter partes. The two subsequent extension orders were thus issued in breach of the specific judicial direction (mandamus) and were illegal.
3. Delayed Effect of Quashing: Though the extensions were illegal, the Court permitted Mr. Mishra to continue until July 31, 2023, to ensure a smooth transition and in light of the Union of India’s expressed concern regarding the Financial Action Task Force (FATF) review.

Conclusion

The Supreme Court upheld the constitutionality of the statutory amendments which allow for multiple one-year extensions to the tenure of the Director of Enforcement (and CBI) up to a maximum of five years, provided the high-level Statutory Committees approve the extension in public interest and record reasons. However, the Court struck down the specific extensions granted to Respondent No. 2 (Sanjay Kumar Mishra) because they violated a previous, binding judicial mandamus issued directly against him and the Union Government, which had crystallized the rights and liabilities inter partes. The Court allowed the incumbent to remain in office temporarily until July 31, 2023, to facilitate the appointment of a successor.